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To stoke growth, Trump adviser calls for overhaul of environmental regulations


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To stoke growth, Trump adviser calls for overhaul of environmental regulations

If Donald Trump wins the election in November, Kathleen Hartnett White, a member of his Economic Advisory Council, would put rolling back "crippling" environmental regulations at the top of a long policy wish list, she told S&P Global Market Intelligence in a wide-ranging interview.

Overall she argued for environmental deregulation and decentralization, an overhaul of the Environmental Protection Agency, more cheap fossil fuels to power U.S. economic growth, an end to Obama's Clean Power Plan and a return of pro-coal policy, such as nixing the controversial moratorium on new coal leases on federal lands.

Hartnett White, the former Chairman and Commissioner of the Texas Commission on Environmental Quality, spoke at length about her personal views on environmental policy as a former regulator, as well as expanding on the implications of Trump’s economic policies. He outlined these last week.

Trump’s team is leaning on the council for advice. Hartnett White, who denies broad scientific agreement that carbon dioxide causes harmful climate change, said she had taken part in a second long conference call last Thursday in which the council weighed in on policy.

"The [Trump] staff briefs us on what's going on, asks questions and then asks for recommendations," she said.

Broadly, Hartnett White represents a hard, anti-Obama voice that argues the U.S. should harness fossil fuels to spur greater economic growth. In the interview she spoke forcefully, and at times derisively, of many environmental policies in the U.S.

She now advises the Texas Public Policy Foundation and recently co-authored the book "Fueling Freedom: Exposing the Mad War on Energy." Her co-author was Stephen Moore, who is also a member of Trump’s economic council. Hartnett White credits the book for putting her on the Trump campaign’s radar.

"I've been told by some of the staff it's been useful to them," she said.

Hartnett White's view

If one agency riles Hartnett White the most, it is the EPA. She contends it has issued too many rules that are too difficult to comply with for industry. They need to be cut, she said.

"A basic recommendation I would make to anyone running for president is we need to review this avalanche of rules that has been promulgated over the last eight years and possibly rescind...and replace [them] with new rules," she said.

In part, she justifies harsh pruning of EPA rules as necessary to spur economic growth in the U.S.

She called EPA regulation a "burden" and "crippling." They are, she said, a "fundamental reason that economic growth has been so so slow in this country — 1.1% I believe is this year’s average.” She added, “And I'm very pleased to see that, actually, a part of Donald Trump's policy plan for accelerating economic growth is a very meaningful section on regulatory reform."

In this respect, her views pair closely with Trump’s, who has promised to boost manufacturing in the U.S. In doing so he has drawn support in hard hit areas of America where manufacturing has moved offshore in recent decades.

To Hartnett White, the key to U.S. growth is cheap fossil fuel increasingly liberated from shale that, in recent years, has catapulted U.S. oil and natural gas production.

"A lot of people go, 'Oh-ho-hum: We've been talking about, you know, making US manufacturing resurgent again and a major part of our economy. [But it] will never happen,'" Hartnett White said.

"We're certainly not going to lower wages. [But] the energy factor makes that no longer a pipe dream if there's the will to do it."

Trump has stated the entire EPA should be ditched, but Hartnett White said she still sees a place for it in regulating industrial impact on the environment.

"Again this doesn't mean we don't need EPA; we don't need regulation; we're already doing a good job. No. Just to maintain the achievements reached ... is a very important function for an administrative agency [like the EPA]," she said.

She acknowledged, however, that an overhaul would be difficult.

"The environmentalists would be extraordinarily resistant to this and there would be all kinds of litigation for who knows how long," she said. "But I really think it's the time to do this. And Congress really needs...[to] take this on; take on its responsibility as the final policy maker on these issues of national consequence."

The role of Congress was a strong thread in her arguments against current policies and environmental regulation. She believes the federal government has usurped authority away from it and that it should be returned to Congress.

"We've delegated such broad authority to EPA that they have created an agency that really is a master of the Congress rather than the other way round," she said.

Plan of attack

With election day still over a month away, Hartnett White said it was "premature" to speculate when and how a Trump administration would execute its energy plan. But recent talks within the campaign, including the call with the economic advisory council, have focused on job and manufacturing growth that will rely on access to energy.

Hartnett White repeated pleas from other Trump advisers, including U.S. Congressman congressman Kevin Cramer of North Dakota and Continental Resources CEO Harold Hamm, to throw out many of the Obama administration's signature climate and energy rules.

Getting rid of the EPA's Clean Power Plan should be the top priority, she said. The rule, which set state-specific carbon emissions rate limits for existing power plants "is really an assertion of federal authority over the entire electric sector, really re-engineering the entire electric system in this country from the energy sources we use to the way we generate electricity," said Hartnett White.

She also attacked the EPA's 2009 finding that carbon dioxide emissions pose a threat to public health and welfare, a determination that prompted the EPA to form the Clean Power Plan under the Clean Air Act.

"Policies of that magnitude to me must be a decision of the U.S. Congress or we don't really function like a democracy anymore, if we have agencies that through very strained interpretation of existing law can impose such bold measures," she said.

Hartnett White also blasted the "really bad science" behind EPA's latest ground-level ozone standard, another rule she said should be undone if Trump enters office.

Regulatory relief is a key pillar of Trump's energy platform, along with freeing up more public lands for energy production. Hartnett White said increasing coal, oil and gas production on federal lands would contribute to Trump's goal of energy independence while providing more revenue for the federal government to reduce national debt.

Heavier fossil fuel production on federal lands and waters runs counter to the Democratic Party's latest platform, which includes phasing down coal, oil and gas production on public lands in a bid to lower greenhouse gas emissions.

But Hartnett White said most of that new energy supply should come from private investment rather than government action.

"I think the best plan for energy is to let the market operate with a minimal amount of government interference," she said.

To reduce that interference, Trump has said he would end the U.S. Department of Interior's temporary moratorium on new federal coal leases and encourage TransCanada Corp. to reapply to build its Keystone XL crude pipeline after the Obama administration denied a permit for the project in November 2015. Hartnett White also said Trump would assure oil and gas drillers that the Outer Continental Shelf in the Gulf of Mexico is "open for business," after permitting slowed down there following the April 2010 explosion at BP's Deepwater Horizon oil rig.

Another area where Trump said the government should step back is subsidies for energy producers.

"He does not want government to pick winners and losers and that means subsidies," Hartnett White said. "And renewables, wind anyways, since the early 1990s has been subsidized."

Despite voicing support for all energy forms, Trump has criticized the cost of solar generation and said wind power would not be competitive with other electricity sources without subsidies.

Much of Trump's energy goals clash with those of Democratic competitor Hillary Clinton, who backs the Clean Power Plan and wants renewable resources to generate a third of U.S. electricity by 2027.

Hartnett White also said she would consider playing a greater role in government if Trump wins in November.

“It is something I think about," she said. Ideally the role would be something focusing on the science of rule making, she added.

But, if that is not to be, Hartnett White said she looked forward to advising Trump's economic council and "making a list of...some really fine professionals that should be a part of the regulatory reform.”